After Professor Charles Dunbar stepped down from his Harvard Deanship, he took sabbatical leave to go to Europe in 1882-83. Frank William Taussig was appointed instructor to help J. Laurence Laughlin cover the three course offerings for political economy that year. In Taussig’s course scrapbook in the Harvard archive, we find that he listed grades for 71 students in Political Economy 1 (1882-83), i.e., about half of the reported enrollment for that course. Thus we may presume that Laughlin and Taussig taught separate sections of the course with a common final examination.
______________________________
Course Announcements
Political Economy.
1. Mill’s Principles of Political Economy. — Lectures on Banking and the Financial Legislation of the United States. Mon., Wed., Fri., at 9. Mr. Taussig and Dr. Laughlin .
2. Cairnes’s Leading Principles of Political Economy. — History of Political Economy. – McKean’s Condensation of Carey’s Social Science. — Lectures. Mon., Wed., Fri., at 2. Dr. Laughlin.
As a preparation for Course 2, it is necessary to have passed satisfactorily in Course 1.
3. Economic Effects of Land Tenures in England, Ireland, France, Germany, and Russia. Once a week, counting as a half-course. Dr. Laughlin.
Source: The Harvard University Catalogue, 1882-83, pp. 89-90.
______________________________
Course Enrollments
1. Mill’s Principles of Political Economy. — Lectures. Dr. Laughlin and Mr. Taussig.
Total 155: 1 Graduate, 22 Seniors, 113 Juniors, 13 Sophomores, 6 Others. 3 hours/week.
2. Cairnes’s Leading Principles of Political Economy. — History of Political Economy. — McKean’s Condensation of Carey’s Social Science. — Lectures. Dr. Laughlin. 3 hours/week.
Total 35: 2 Graduates, 24 Seniors, 8 Juniors, 1 Other.
3. Studies in Land Tenures of England, Ireland, and France. — Theses. Dr. Laughlin. 1 hour/week.
Total 7: 1 Graduate, 6 Seniors.
Source: Harvard University. Report of the President of Harvard College, 1882-1883, p. 66.
______________________________
Course Examinations
POLITICAL ECONOMY 1.
Mid-year 1882-83
I.
(Answer briefly all of the following.)
- What distinction does Mill draw between productive and unproductive labor? Discuss the value of this distinction. Distinguish between productive and unproductive consumption.
- What is the distinction between fixed and circulating capital? Is money part of the fixed or of the circulating capital of a country? Why?
- What are the classes among whom the produce is divided? Are these classes necessarily or usually represented in as many different sets of persons? How could you classify the peasant proprietor?
- Of what commodities are the values governed by the law of cost of production? Explain the process by which that law operates.
- “Rent does not enter into the cost of production of agricultural produce.” Explain.
- What regulates the value of an inconvertible paper currency? What cause it to depreciate? Discuss briefly the results of depreciation.
- Arrange the following items on the proper sides of the account:—
|
Circulation |
315.0 |
| Due to Bans |
259.9 |
| Legal Tender Notes |
63.2 |
| Loans |
1,243.2 |
| Bond for circulation |
357.6 |
| Due from Banks |
198.9 |
| Deposits |
1,134.9 |
| Specie |
102.9 |
Compute just how much circulation is permitted by our laws; and give in figures both the (1) reserve required at 25%, and the (2) difference between the actual and required reserve, on the basis of the above account.
- Compare the plans of our National Bank system with those of the Bank of England and the Imperial Bank of Germany in regard to the security of note-issues.
II.
(Answer more fully three of the following.)
- What are the constituent elements of what Mill calls “profits”? Explain what is meant in common language by the word “profits,” and discuss the nature of profits in this sense.
- “The laws of the production of wealth partake of the nature of physical truths…It is not so with the distribution of wealth. That is a matter of human institution solely.” Explain the distinction, and show its connection with the subjects of communism and socialism.
- Mention the methods by which it is attempted to keep gold and silver concurrently in circulation. Explain why “a double standard is alternately a single standard.” Does this tend to be the case now in the United States?
- Distinguish between real and proportional wages, and illustrate the distinction. In what sense is the word wages used when it is said that the profits depend on wages, rising as wages fall, and falling as wages rise?
- It is not a difference in the absolute cost of production which determines the international cost of exchange, but a difference in the comparative” Explain this proposition, and apply it to the trade between the United States and European countries. Is the trade between tropical and temperate countries based, in the main, on a difference of absolute or of comparative cost?
Source: Harvard University Archives. Harvard University, Examination papers, 1873-1915. Box 2. Bound volume Examination Papers, 1881-83. Papers Set for Mid-Year Examinations in Rhetoric, Philosophy, Political Economy, History, Roman Law, Fine Arts, and Music in Harvard College (February, 1883), pp. 8-10.
POLITICAL ECONOMY 1.
Year-end 1882-1883
I.
(Take all of this group.)
- Explain what is meant by a bill of exchange. What causes bills on a foreign country to be at a premium or discount? Show in what way the premium (or discount) is prevented from going beyond a certain point.
- Is there any connection between the rate of interest and the abundance or scarcity of money? Explain and illustrate the following: “The rate of interest determines the price of land and of securities.”
- Describe the three different kinds of cooperation, and say something of the success attained by each. What are the two classes of distributive cooperation, and wherein do they differ?
- Show under what circumstances the increase of capital brings about the tendency of profits to fall. What influences counteract this tendency?
- Explain what is meant by the rapidity of circulation of money. What is the effect of great rapidity of circulation on prices and on the value of money? What is the effect of the use of credit? Mention the more important methods in which credit is used as a substitute for money.
II.
(Omit one of this group.)
- Discuss the effect of the introduction of a new article of export from a given country on the course of the foreign exchanges in that country, on the flow of specie, and on the terms of international trade (i.e. on international values).
- What are the causes which enable one country to undersell another? Do low wages, or a low cost of labor, form one of those causes?
- Discuss the immediate and the ultimate effects on rents of the introduction of agricultural improvements. Do those ultimate effects which Mill describes necessarily take place?
- What is the immediate and what the ultimate incidence of a tax on houses? Show in what manner the incidence of a tax on building-ground differs, according as the tax is specific (so much on the unit of surface), or rated (so much on the value).
III.
(Omit one of this group.)
- Describe the situation which caused the banks in the United States to suspend specie payments in 1861.
- What is the difference between bonds and Treasury notes? Name and explain the different kinds of bonds issued during the war.
- Explain the causes which made possible the great sales of five-twenty bonds in 1863.
- What arguments were advanced for the continuance of the National Bank System in 1882?
Source: Harvard University Archives. Harvard University, Examination papers, 1873-1915. Box 2. Bound volume Examination Papers, 1881-83. Papers Set for Final Examinations in Rhetoric, Philosophy, Political Economy, History, Roman Law, Fine Arts, and Music in Harvard College (June, 1883), pp. 7-8.
______________________________
Course Examinations
POLITICAL ECONOMY 2.
Mid-year 1882-83
- Give a careful statement of Mr. Cairnes’s theory of market and normal value.
- How far is it right to suppose that the competition of (1) capital and (2) of labor is effective?
- Explain and discuss the statement that “the wages-fund expands as the supply of labor contracts, and contracts as the supply expands.”
- Agricultural products in England are as dear as one hundred years ago; in the meantime there has been extraordinary industrial progress. What conclusion is to be drawn as to the increase of wages and profits from the first fact, and who has ultimately gained by the second?
- Mill thinks that, although “the great efficiency of English labor is the chief cause why the precious metals are obtained at less cost by England,” the “somewhat higher range of general prices in England” is accounted for by the foreign demand, and the unbulky character of her commodities.
What different explanation is offered by Mr. Cairnes? - Examine the following:—
“It seems to me that protection is absolutely essential to the encouragement of capital, and equally necessary for the protection of the American laborer….He must have good food, enough of it, good clothing, school-houses for his children, comforts for his home, and a fair chance to improve his condition. To this end I would protect him against competition with the half-paid laborers of European countries.”— Cong. Globe. - If there should be a considerable falling off in the foreign demand for the products of one group of industries, such as our bread-stuffs, how would that affect wages in this country?
- What is the argument against the theory that the Bank of England brought about resumption of specie payments in England in 1821 by a contraction of its note-issues?
- In what period in the history of economic doctrines would you place the writer of the following passage?
“The strength of a community declines with increase in the rate of interest. That increase results from efflux of the precious metals.” Explain. - Comment on the main doctrines held by Cantillon and Storch.
Source: Harvard University Archives. Harvard University, Examination papers, 1873-1915. Box 2. Bound volume Examination Papers, 1881-83. Papers Set for Mid-Year Examinations in Rhetoric, Philosophy, Political Economy, History, Roman Law, Fine Arts, and Music in Harvard College (February, 1883), pp. 10-11.
POLITICAL ECONOMY 2.
Year-end 1882-1883
[Do not change the order of the questions.]
- Examine the following doctrine:—
“If invention and improvement still go on, the efficiency of labor will be further increased, and the amount of labor and capital necessary to produce a further increased, and the amount of labor and capital necessary to produce a given result further diminished. The same causes will lead to the utilization of this new gain in productive power for the production of more wealth; the margin of cultivation will be again extended, and rent will increase, both in proportion and amount, without any increase in wages and interest. And so,…will…rent constantly increase, though population should remain stationary.”—Henry George, Progress and Poverty (p. 226). - What is meant by the “comparative costs of production,” on which international values are said to depend, and how is that dependence to be reconciled with the fact that any given sale of goods is found to be an independent transaction, determined by the price of the commodity?
- How does the doctrine of reciprocal demand between different industries apply to the argument in favor of a diversity of employments in a new country, as laid down by Hamilton in his Report on Manufactures?
- Of the economic doctrines generally accepted to-day which would you consider as having originated with Adam Smith?
- Discuss the following words of Mr. Carey:—
“From 1810 to 1815 mills and furnaces were built, but with the return of peace, their owners…were everywhere ruined…From 1828 to 1834, such establishments were again erected, and the metallic treasures of the earth were being everywhere developed; but, as before, the protective system was again abandoned, with ruin to the manufacturers.” (Vol. II, p. 224.) - Explain the relation, in Mr. Carey’s system, between “wealth,” “utility,” “value,” and “capital.” State clearly the “harmony of interests” between labor and capital, and the connection of this with the wages question.
- Point out Mr. Carey’s objections to the doctrine of Malthus. How far does his position on this question affect his acceptance of Ricardo’s law of rent?
- Discuss the following statement:—
“If such [a] league be formed on a permanent basis between a considerable number of important commercial countries, even though it does not embrace all countries, the relative value of gold and silver will be kept close to the mint ratio so established.”—A.Walker, Political Economy (p. 408). - Examine this position:—
“The rent of mines is not governed wholly by the economic law of rent which, as stated, has reference to the native and indestructible powers of the soil….By the very nature of such deposits [i.e. in mines], the enjoyment of mining privileges diminishes the sum of the mineral in existence. The mine may be ‘worked out’ in ten years or in twenty….The rent must be increased sufficiently to compensate for the ultimate exhaustion of the deposits: the destruction of the value of the estate.” - Describe the form in which Germany actually received the payment of the indemnity from France.
Source: Harvard University Archives. Harvard University, Examination papers, 1873-1915. Box 2. Bound volume Examination Papers, 1881-83. Papers Set for Final Examinations in Rhetoric, Philosophy, Political Economy, History, Roman Law, Fine Arts, and Music in Harvard College (June, 1883), pp. 8-9.
______________________________
Course Examinations
POLITICAL ECONOMY 3.
Mid-year 1882-83
- What is the usual legal conception of property in the increased value of land? How far is this justified?
- In the claims of tenants for compensation for unexhausted improvements what weight do you give to the argument of landlords that legislation on this subject would be an interference with freedom of contract?
- What was the Agricultural Holdings Act of 1875? What were its results?
- Discuss the present length of leases in England, and compare with that of a century ago. Are there any political causes affecting the question?
- What is the aim of the Registration of Titles Act of 1875? What is the system of transferring property in England now actually in use?
- State some of the effects of the practice of entails on the application of capital to land. Point out how this question has been discussed in its relation to wages.
- What change has been going on in the character of English agriculture within the last thirty years? What influences do you attribute to American competition in this matter?
- In the depression of English agricultural interests, which class connected with the land seems to have suffered most?
- What has been the relation of the agricultural laborer to the land, and how far has it been possible for him to improve his position?
- It is said that farmers can use their capital more profitably in farming hired land than in sinking it in the purchase of the soil. What do you think on the advantages to the cultivators of owning the land in England?
Source: Harvard University Archives. Harvard University, Examination papers, 1873-1915. Box 2. Bound volume Examination Papers, 1881-83. Papers Set for Mid-Year Examinations in Rhetoric, Philosophy, Political Economy, History, Roman Law, Fine Arts, and Music in Harvard College (February, 1883), pp. 11-12.
POLITICAL ECONOMY 3.
Year-end 1882-1883
- State what you believe to be the most important effects of the Repeal of the Corn Laws upon agriculture and the present system of land-holding in England.
- It has been asserted that “a peasant population, raising their own wages from the soil, and consuming them in kind, are universally acted upon very feebly by internal checks, or by motives disposing them to restraint. The consequence is, that unless some external cause, quite independent of their will, forces such peasant cultivators to slacken their rate of increase, they will, in a limited territory, very rapidly approach a state of want and penury, and will be stopped at last only by the physical impossibility of procuring subsistence.” What testimony on this question is offered by the experience of France and Germany?
- How does absenteeism (1) affect the production of agricultural wealth? (2) Does it modify the laws of distribution?
- Give an explanation of the fact that in Ireland custom forces the tenant, not the landlord, to carry out the improvements on the soil. How far does this affect the question of compensation for unexhausted improvements.
- To what do you ascribe the “land-hunger” and rack-rents in Ireland? Why have manufactures not aided the agricultural classes, as they have in the north of England?
- What were the “Bright clauses” of the Irish Land Act of 1870, and their results? Describe briefly the provisions of the Irish Land Act of 1881.
- In view of new legislation in favor of English tenants, it is stated by the journals that to-day the Irish stands on a better legal footing than the English tenant. If this is true, point out the different advantages by the former.
- Under the old régime in France it is clear not only that there were many peasant proprietors, but also that agriculture was not flourishing. What other economic forces were at work, and what causes would you assign as the ones unfavorable to agriculture?
- What were the facts as to the increase of population (1) under the old régime, and (2) after the extension of small holdings? What light does this throw on the Irish land question?
- Discuss the evils supposed to arise from the French law of equal partition of property among the heirs at the death of the owner.
- Describe briefly the reforms of Stein and Hardenberg in the land legislation of Germany. What parallel is drawn between this plan and the course followed by France?
Source: Harvard University Archives. Harvard University, Examination papers, 1873-1915. Box 2. Bound volume Examination Papers, 1881-83. Papers Set for Final Examinations in Rhetoric, Philosophy, Political Economy, History, Roman Law, Fine Arts, and Music in Harvard College (June, 1883), pp. 9-10.
Image Source: Harvard Library, Hollis Images. James Laurence Laughlin (left) and Frank W. Taussig (right).